Central Texas Express Metalwork LLC d/b/a Express Contracting
ASBCA No. 61109
| A.S.B.C.A. | Sep 7, 2017Background
- In 2011 the Air Force awarded CTEM Contract No. FA3047-11-C-0023 to perform HVAC work for $2,457,237; the contract required a release of claims for final payment.
- CTEM subcontracted work to IMS; IMS later sued CTEM and the parties settled, with CTEM agreeing to sponsor IMS’s claim against the government.
- In November 2013 CTEM and the CO agreed to reduce scope (a $286,645.41 credit to the Air Force) and a $62,421.68 equitable adjustment to CTEM; CTEM reserved an intent to file additional delay claims.
- CTEM submitted a certified REA in September 2014 seeking $643,841.88 (including $345,691.07 for IMS). In May 2016 the parties negotiated a settlement: the Air Force would pay the remaining contract balance of $395,727.99 in exchange for CTEM’s delivery of a final invoice and a broad release.
- CTEM’s president signed the release on June 2, 2016; DFAS attempted payment, CTEM’s bank returned the EFT and CTEM sought to rescind/modify the payment. CTEM later submitted a certified claim for $643,841.88; the CO denied it as released. CTEM appealed to the ASBCA.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether CTEM's post‑settlement claim is barred by the signed release | CTEM argues no final payment occurred because it refused/blocked the EFT, so the release is unenforceable | Government argues CTEM executed a release in consideration of final payment under the contract and acceptance created a binding settlement; release bars remaining claims | Release enforceable; settlement formed and final payment obligation created a binding contract; claim barred |
| Whether the release lacked consideration | CTEM contends there was no new consideration supporting release | Government contends the contract required a release at final payment (contract is consideration) and the Air Force forewent a contractual credit as additional consideration | Release was supported by the contract’s final‑payment provision; foregone credit also provided consideration if treated as a modification |
| Whether the release excepted a sponsored subcontractor claim (IMS) | CTEM asserts the CO knew CTEM was sponsoring IMS’s claim, so final payment should not bar that sponsored claim | Government contends IMS’s sponsored claim was part of the settled amount and there was no evidence CO understood any additional uncompensated right remained | Release covered the sponsored IMS claim because it was part of the settled claim and there was no evidence the CO knew CTEM sought additional compensation beyond the settlement |
| Whether any equitable exceptions (fraud, duress, mutual mistake) save CTEM’s claim | CTEM did not advance specific equitable defenses in opposition | Government notes no such defenses were alleged or shown | No equitable exception applied; CTEM did not assert or prove fraud/duress/mistake |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment standard)
- Anderson v. Liberty Lobby, 477 U.S. 242 (summary judgment and drawing inferences)
- Mingus Constructors, Inc. v. United States, 812 F.2d 1387 (final release with final payment bars contract claims)
- Anderson v. United States, 344 F.3d 1343 (contract formation principles — acceptance and revocation)
- Dairyland Power Coop. v. United States, 16 F.3d 1197 (non‑movant burden at summary judgment where it bears proof at trial)
- Metcalf Constr. Co. v. United States, 742 F.3d 984 (duty of good faith and fair dealing in contract performance)